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CHAP 11 ECON 2020
Final Exam Flashcards
15
Economics
Undergraduate 2
05/04/2009

Additional Economics Flashcards

 


 

Cards

Term
Perfectly Competitive Market
Definition
A market that meets the conditions of (1) many buyers and sellers,(2) all firms selling identical products, and (3) no barriers to new firms entering the market.
Term
Price Taker
Definition
A buyer or seller that is unable to affect the market price.
Term
Average Revenue
Definition
Total Revenue divided by the quantity of the product sold.
Term
Marginal Revenue
Definition
Change in total revenue from selling one more unit of a product.
Term
Profit Maximizing Point
Definition
The point at which the difference between TR and TC is the greatest.
Term
Sunk Cost
Definition
A cost that has already been paid and that cannot be removed.
Term
Shutdown Point
Definition
The minimum point on a firm's average variable cost curve; if the price falls below this point, the firm shuts down production in the short run.
Term
Economic Profit
Definition
A firm's revenues minus all its cost, implicit and explicit.
Term
Economic Loss
Definition
The situation in which a firm's total revenue is less than its total cost, including all implicit costs.
Term
Long-run Competitive Equilibrium
Definition
The situation in which the entry and exit of firms has resulted in the typical firm breaking even.
Term
Long-run Supply Curve
Definition
A curve that shows the relationship in the long run between market price and quantity supplied.
Term
Increasing-cost Industries
Definition
Industries with an upward sloping long-run supply curve.
Term
Decreasing-cost Industries
Definition
Industries with downward sloping supply curves.
Term
Productive Efficiency
Definition
The situation in which a good or service is produced at the lowest possible cost.
Term
Allocative Efficiency
Definition
A State of the economy in which production represents consumer preferences; in particular, every good or service is produced up to the point where the last unit provides a marginal benefit to consumers equal to the marginal cost of producing it.
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